Volume 68, Issue 1

Who Gains More Power in the EU after Brexit?

Abstract: Brexit implications are analysed in most cases from the macroeconomic, financial or legal point of view while these areas are not the only ones the economists or governments should pay attention to. In this article we focus on how Brexit influences application of the European procedures, i.e. the results of various voting scenarios in the Council of the European Union. Based on power indices we examine changes of power distribution within the European Union (EU) from the perspective of each EU Member State separately as well as potential coalitions. This analysis covers also projection of power distribution in 2030 and 2060 that takes into account population forecast prepared by the Ageing Working Group. We find that larger countries benefit from the new possible power distribution while the smaller ones lose their power. Moreover, power of coalitions built by the EU Member States, representing different groups of interests in particular voting, e.g. EU budget or enforcement of the EU rules, seems to be vulnerable to the implications of the decision of the United Kingdom to leave the EU. Brexit may influence the quality of institutional and macroeconomic policy, especially in terms of decisions on the strictness of the EU rules.

JEL classification: C71, F15

Keywords: Brexit, power index, voting power, Council of the European Union, demographics